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Tax-dodging firms lose state contracts

Starbucks was one of the companies that avoided paying UK tax (Johnny Green)

COMPANIES that avoid paying their fair share of tax will be barred from
lucrative contracts with the government under a crackdown on tax avoidance.

Ministers and officials will be able to block multimillion-pound Whitehall
contracts with firms that use elaborate schemes to avoid millions of pounds
in tax.

For the first time the new rules will also force bidding companies to disclose
their tax compliance history, detailing any unpaid tax bills and their use
of aggressive tax avoidance mechanisms.

The rules are expected to be announced this week by Francis Maude, the Cabinet
Office minister responsible for government contracts, and Danny Alexander,
chief secretary to the Treasury. “It’s about making sure that companies that
bid for contracts are going to pay the correct amount of tax,” said a
government source. “This is an important step.”

It follows criticism by MPs of firms such as Amazon, Google and Starbucks for
their